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Arsenal’s new signings Declan Rice, Kai Havertz, and Jurrien Timber all started but failed to make an impact as Man City won.
Havertz tested Stefan Ortega twice in the first half but failed to convert on both occasions.
The breakthrough came after Pep Guardiola made many substitutions, with De Bruyne and Palmer going on, and the duo combined to secure the win for Man City, with Palmer scoring in the 77th minute.
However, there was late drama when Leandro Trossard equalized in the 11th minute of stoppage time.
Following Martin Odegaard’s conversion, De Bruyne was up first for City in the penalty shootout, and the Belgian slammed his shot against the crossbar.
Trossard came next, sending Ortega the wrong way to convert his spot-kick, before Bernardo Silva did the same.
Bukayo Saka scored smoothly as Arsneal maintained control.
Rodri was up next for City, but Aaron Ramsdale stopped his shot before Fabio Vieira scored into the top corner to give Arteta’s side the win.